Fewer Americans bought previously occupied homes in February and those who did purchased them at steep discounts. The weak sales and rise in foreclosures pushed home prices down to their lowest level in nearly 9 years.
At February's sales pace, the supply of existing homes represented an 8.6 months' supply, up from 7.5 in January. A supply of between six and seven months is generally considered ideal, with higher readings pointing to lower house prices.
"Inventory is still high, about a third higher than it was pre-recession. We are not going to see any bounce back in new home sales until the inventory of existing home sales gets worked down," said Steve Blitz, a senior economist at ITG Investment Research in New York.
"We don't even know what the inventory is. We see a visible supply but then there is a shadow supply that comes on and off the market depending on the time of the year. It's still a morbid market on a national level."
...the Census Bureau confirms that sales of new homes has hit another record low in the 48 years that the US government has tracked this economic indicator, sliding to an annual sales rate of 250,000.
That marked the lowest number of units sold since 1963, when records began.
At the current rate it would take almost nine months for the all the new homes on the US market to be sold -- if no more homes are built.
The biggest slowdown in turnover was seen in the country's populous northeast, with sales down 57 percent from January.
"Nothing good can be said about the February report," said Steven Ricchiuto, an economist with Mizuho describing it as "several times worse that the markets expected."